Fiscal Deficit and Public Debt in Industrial Countries, 1970-1994

May 1, 1995

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Domenico Fanizza, and Vito Tanzi. Fiscal Deficit and Public Debt in Industrial Countries, 1970-1994, (USA: International Monetary Fund, 1995) accessed December 26, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper assembles a set of relevant fiscal data, for both the individual countries and for the aggregate G-7 and 18 industrial countries, which covers a period long enough to allow an assessment of trends and the conduct of econometric tests. The “world” fiscal deficit has been rising since the 1970s and reached a historic high in 1993-94; the rise of the deficit has been accompanied by a significant decline in world saving. The paper argues that the increase in public debt, which has been the consequence of the accumulation of the fiscal deficits, has pushed up worldwide interest rates. Econometric evidence in support of this relationship is presented on the basis of panel data for the period 1970-93.

Subject: Expenditure, Financial services, Government debt management, Long term interest rates, National accounts, Private savings, Public debt, Public financial management (PFM), Real interest rates

Keywords: Countries GPS, Debt coefficient, Debt dynamic, Deficit, Deficit country, G-7, GDP ratio, Global, Government debt management, Percentage of GDP, Private savings, Real interest rates, WP

Publication Details

Pages:

38
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1995/049
Stock No:

WPIEA0491995
ISBN:

9781451846782
ISSN:

1018-5941

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